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Friday, Dec 9, 2022

CIM Puts Landmark Retail Location on Market

CIM Group Inc. is selling its nearly 60,000-square-foot retail space anchored by downtown’s Ralphs Fresh Fare market.

Hanley Investment Group Estate Advisor’s Urban Retail Advisors unit is marketing the property. It has no listing price but the Irvine brokerage is taking offers until Sept. 24.

The retail space is on the ground floor of the Market Lofts, a 267-condo development at 645 W. Ninth St. at Flower Street. The condos are not part of the sale. The site is walking distance to Staples Center, L.A. Live and the Fig at 7th project, where a City Target will open this fall.

CIM purchased the property in 2001 and redeveloped what had been a vacant office building, a parking garage and outdoor lot into a 350,000-square-foot mixed-use property. It was completed in 2007, and Kroger Co.’s Ralphs Fresh Fare signed a lease to anchor the property.

It became the first full-service grocery store in downtown for more than 50 years. It has consistently posted some of the chain’s highest sales volume, according to downtown brokers.

The rest of the ground floor retail is now fully occupied with tenants that include Coffee Bean & Tea Leaf, Quiznos and Supercuts, according to Carlos J. Lopez, president of Hanley’s retail group.

“The offering at Market Lofts represents an extremely rare opportunity to purchase the only full-service supermarket-anchored property in downtown Los Angeles,” he said.

There aren’t any comparable properties that have sold in the downtown area that would provide insight into what price this property could fetch. But last year the ground-floor retail space at South Group’s Luma mixed-use condo property – a mostly vacant 6,000-square-foot space– sold for $2.6 million, or $427 a square foot, according to real estate data provider CoStar Group Inc.

Lopez said the decision to sell was a “strategic move” for the company but declined to elaborate further. CIM, which has more than $9.5 billion in assets under management nationwide, buys and develops real estate on behalf of pensions and other investors. It sold the Renaissance Hollywood Hotel next to its Hollywood & Highland Center in June.

Building Culver City

Construction has started on a $63 million mixed-use project in Culver City near the new Expo Line station.

NMS Properties Inc. is developing the transit-oriented project at 9901 Washington Blvd., which will have 131 apartments with ground-floor shops and restaurants near the heart of downtown and across the street from the Kirk Douglas Theater. The project is on the site of a movie theater that has been demolished.

The residences are one to three bedrooms and range from 606 to 1,383 square feet. The building will include a rooftop garden and community room. Most units will rent at market rate but 11 percent are reserved for low-income residents. The ground floor will include 12,550 square feet of retail along Washington Boulevard.

Jim Andersen, president of the development firm, said he believes that the project will add to downtown’s renaissance.

“We find the redevelopment program and streetscape emerging along Washington Boulevard in Culver City extremely attractive and believe our project will further enhance the streetscape renaissance occurring there,” he said.

The project is being designed by Killefer Flamming Architects. Completion is set for 2014.

Mixed Message

It’s still a retail tenant’s market in Los Angeles County.

A new report from Jones Lang LaSalle Inc. said that the retail vacancy rate in the first six months of the year rose to 6.3 percent, a tenth of point higher than a year earlier. That’s pushed monthly asking rates down three cents to about $2.03.

David Sorenson, a leasing representative at the Chicago-based brokerage, said the rates may look flat but he’s noticing that the metrics are inspiring retailers to start making more deals.

“I’m seeing a greater velocity of tenants looking for space and a lot of tenants with increased incentive to open new stores,” he said.

The anticipated increased activity led the brokerage to forecast that vacancy rates will begin to tighten and rents will begin picking up next year and grow through 2016.

Staff reporter Jacquelyn Ryan can be reached at jryan@labusinessjournal.com or (323) 549-5225, ext. 228.

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